Duke Energy Florida (NYSE: DUK) has announced plans for three major construction projects to continue meeting the needs of its customers. If the plans are approved by the Florida Public Service Commission, the company will construct a state-of-the-art, highly efficient combined-cycle natural gas power plant in Citrus County and two simple-cycle combustion turbine generators at the Suwannee Plant near Live Oak.
Additionally, it will install new equipment at the Hines Energy Complex near Bartow to increase efficiency and power output.
Officials also announced the retirement timeline for two coal-fired units at the Crystal River Energy Complex.
If approved by regulators, the projects will benefit customers by increasing systemwide reliability and efficiency while reducing emissions.
“We are making these investments to continue providing our customers with the most cost-effective energy solutions and highest level of reliability with limited environmental impact,” said Alex Glenn, Duke Energy state president – Florida. “We are committed to ensuring our customers’ energy needs are met 24 hours a day, seven days a week now and in the future.”
Today, Duke Energy Florida will provide the Florida Public Service Commission an update in Tallahassee on these projects. On May 27, 2014, the company will formally submit the plans to the commission for approval. A commission ruling is expected later this year.
New combined-cycle natural gas plant in Citrus County
After a months-long request for proposals process, Duke Energy Florida has selected its self-build option to construct a 1,640-megawatt combined-cycle natural gas plant to help serve Florida’s approximately 1.7 million customers starting in 2018. The anticipated cost to build the new plant is approximately $1.5 billion, including financing costs.
“Our proposal is the most cost-effective option for customers that provides systemwide reliability, ensures regulatory compliance and meets our needed 2018 in-service construction timeline,” said Glenn.
The new plant will be located on 400 acres adjacent to the existing Crystal River Energy Complex. Construction and related activities are expected to add several million dollars to the local tax base. During the height of construction, 600 to 700 jobs are expected to be created.
If all regulatory approvals are received, construction is expected to start in early 2016. The plant’s first 820 megawatts are expected to come online in spring 2018, and the second 820 megawatts are expected to be available by December 2018.
The plant will receive natural gas through a new pipeline Sabal Trail Transmission is constructing. The pipeline will start in Alabama, extend through Georgia and end in Central Florida. Sabal Trail Transmission will license, construct and operate the natural gas pipeline.
Duke Energy Florida also announced its intent to retire Crystal River coal-fired units 1 and 2 due to changing federal environmental regulations. The retirements will take place when the Citrus County combined-cycle plant becomes operational.
New simple-cycle combustion turbine generators at Suwannee Plant near Live Oak
To meet customers’ energy needs starting in 2016 as identified in Duke Energy Florida’s 10-year site plan, the company also plans to build two simple-cycle combustion turbine generators on 68 acres at the Suwannee Plant. The 320 megawatts of generation will accommodate peak electricity demand and serve customers beginning in 2016. The anticipated cost to build the units is approximately $197 million, including financing costs.
The three steam plants built in the 1950s are slated to be retired in 2016 when the combustion turbine generators become operational.
Duke Energy will help employees through the plant retirements and redeploy as many as possible to other positions within the company.
Equipment additions at Hines Energy Complex near Bartow
At the Hines Energy Complex in Polk County, which has four combined-cycle power blocks, Duke Energy Florida plans to install inlet air chilling units to increase efficiency and power output during the hot summer months. Chillers are like air conditioning units, cooling the outside air that is used during the combustion process.
By 2017, these upgrades will add about 220 megawatts to the plant’s existing 1,912 megawatts of generation. The anticipated cost to install the chillers is approximately $160 million, including financing costs.
Duke Energy Florida owns coal-fired and natural gas generation providing about 9,000 megawatts of owned electric capacity to approximately 1.7 million customers in a 20,000-square-mile service area.
